Cognyte Software (CGNT) Q2 2025 earnings summary

Executive summary

• Achieved strong Q2 FY25 results with revenue growth, improved profitability, and increased customer demand for AI-driven investigative analytics solutions.

• Q2 revenue reached $84.4M, up 10% year-over-year, with recurring revenue at $46.6M (55% of total).

• Non-GAAP gross profit grew 13% year-over-year to $60.2M; adjusted EBITDA was $8.3M, up from $2.3M in Q2 FY24.

• Secured three follow-on orders over $10 million each from national security and law enforcement agencies.

• Recognized for AI-driven threat intelligence solution Lumina in a Gartner report.

Financial highlights

• Q2 revenue was $84.4M, up 9.6% year-over-year; H1 revenue reached $167.1M, up 11.2% year-over-year.

• Non-GAAP gross margin reached 71.3%, up 209 basis points year-over-year.

• Q2 non-GAAP operating income was $4.4M; adjusted EBITDA was $8.3M (9.8% margin); non-GAAP EPS was $0.05.

• Q2 GAAP net loss was $1.9M (EPS $(0.03)), a significant improvement from $9.4M loss (EPS $(0.13)) a year ago.

• Cash and cash equivalents increased to $91.7M as of July 31, 2024, from $74.5M at January 31, 2024.

Outlook and guidance

• Raised full-year revenue outlook to $347M, plus or minus 2%, representing 11% year-over-year growth.

• Increased adjusted EBITDA guidance to about $25M, nearly triple last year’s figure.

• Expect annual non-GAAP EPS loss of $0.03 at the midpoint.

• Guidance excludes potential impacts from future acquisitions and assumes stable foreign exchange rates.